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Message Subject: Summary of Week #2

Forum: ARV Conference Discussion Area
Re: Welcome (Steven Forsythe)
Date: 05/May/1998 22:49
From: forsythe@liverpool.ac.uk>

Thanks again to all the participants during the second week of discussions. The level of participation was superb and I look forward to another week of very stimulating discussions. The response we have received from participants has been quite positive, and we have therefore decided to extend the site for a fourth week, so that all those who want to contribute can do so.

Having said that, I also think that during this third week, it is important to narrow our discussions toward providing more practical recommendations regarding "where we go from here". As posed in a contribution by Katherine Floyd, "What kinds of research questions should economists address?" It strikes me that the groundwork has been established, but nobody has yet proposed a research agenda for the economists.

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There appears to be a consensus among both economists and non-economists that saying, "these drugs are too expensive for developing countries" is not a sufficient response. Instead, we need to develop more creative ways of addressing this issue. As Claudes Kamenga said, we need to look at "revolutionary ideas on how this unacceptable situation can be changed."

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Personally I don't believe that it is unreasonable to begin with the question, "Is there any way that these drugs can be offered cost-effectively?" At the same time, we must recognize that the "revolutionary ideas" are probably not going to involve the financing of triple combination therapy from IMF reserves or large-scale contributions from developed countries. We, as economists, must be both realistic and creative.

The discussions seem to continue to emphasize the differences between wealthier and poorer developing countries. In some wealthier developing countries, the best solution may be to offer triple combination therapy with public funds (yet we still don't have the convincing economic evidence that indicates that this type of care will be affordable or sustainable). Despite the initiation of triple combination therapy in countries such as Brazil, Costa Rica, Mexico, Colombia, etc., I am not aware of any economic research that is looking at the costs and benefits of offering these drugs. What is the impact of these drugs on household expenditures, income, consumption, and savings? How will these drugs affect spending in public health? How should businesses respond to the demand for these drugs among their employees infected with HIV? Do these drugs offer long-term benefits to the national economies and will these benefits exceed the substantial costs of purchasing and administering these drugs? There are economic research proposals that have been developed in countries such as Colombia to address these issues, but that have not yet been funded. During the course of our discussions, contributors from Malaysia and Uruguay have both indicated the need to have economists working on this issue in order to develop a set of policy recommendations.

In researching this issue, I have also found a lack of data in either developed or developing countries regarding the "willingness and ability to pay" of consumers for these drugs. For example, if the cost of offering triple combination therapy to 25% of those infected with HIV in the Americas is estimated to be $6 per capita, are people willing to pay for this type of insurance to assure that if they ever need triple combination therapy, it will be made available to them?

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In addition, contributors emphasized that economic analysis should look at the future of drug prices, rather than constraining our analyses to current price assumptions. As Waranya Teokul, Tito Coleman and Marco Antonio A. Vitoria stated in their contributions to this site, it is important not only to look at current pharmaceutical prices, but also to look at future prices and to assess how they might be reduced more quickly.

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There may also be partial solutions in poorer developing countries, although in this case it will almost certainly not be the same therapy as is being offered in developed countries. Currently only the wealthiest people in these countries are able to access triple combination therapy through the private sector. Some might suggest that this inequitable solution is the only feasible solution at this time, and that the government should stay on the sidelines, at least for the time being. Yet others would suggest that monotherapy, sequential monotherapy, pulse therapy or dual therapy should be assessed as possible cost-effective alternatives for these countries for the time being. It may also be necessary to begin by looking at less expensive drugs to treat opportunistic infections, as opposed to the more expensive ARVs.

I believe the challenge for each of us at the end of the second week is to assess what might be possible, and to look at the tools that economists might use to help policymakers select the appropriate alternative for each country. While it is not being suggested that decisions should be made purely on economic grounds, I think there is an undeniable need for further economic research to better inform the policy process in developing countries. Therefore I challenge participants to propose a new research agenda in health economics for ARV therapy in developing countries.


Responses:

1. Re: Summary of Week #2 by smisra@giasdla.vsnl.net.in, 06/May/1998 11:18

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